Asia Rice Traders Speculate Buying as Food Sources Plunge

The trend has increasingly stimulated the rice markets that pegged at high prices as traders in Asia are anticipating hopes of greater demands in the future from disaster-hit countries.

Rice traders have been anticipating a relax tempo on rice export regulations in India, the second largest rice producers of the world, expecting 100 million tonnes of milled rice be traded in the market as the country has been on good monsoon rains. In 2009/10 harvest season, India was able to produce more than 89 million tonnes of rice which was 11.3 percent lower than a past year as it experienced the worst monsoon in about four decades.

This year alone, Thailand which is considered as the largest rice exporter of the world is now aiming to sell its 8.5 tonnes of rice. Meanwhile, Vietnam, the second largest rice exporter, has just recently increased the floor prices of its rice export  for 5% broken grain from $400 to $430 per tonne and from $370 to $390 per tonne for its 25% broken rice.

On the other hand, demands in parboiled rice of Africa have supported prices of Thai rice in the market as its benchmark 100% Class B white rice is pegged at $490 per tonne with a slight increase from last week's $485 per tonne. 

But rice exporters believed that this gain is not sustainable because the hype on food scarcity is not as exaggerated as in 2008 which brought rice prices to as much as $1,080 per tonne.  Exporters said that rice buyers know that there are rice stocks in Thailand, Vietnam, and India which are considered to be the major rice producing countries in the world.